TOKYO (Reuters) - Europe can send a positive signal to investors and international partners that it is determined to solve its debt crisis by boosting the total firepower of its rescue mechanism and frontloading its funding, Japanese officials said on Monday.
Japan has repeatedly expressed its willingness to help Europe contain its debt crisis, but has also stressed it wanted to see a convincing action plan before making any firm commitments.
"Japan like other non-euro countries is prepared to do something, but unless European countries take decisive action it is hard to make those steps effective," a senior Japanese government official said.
Lifting the combined size of the current bailout fund (EFSF) and the new permanent European Stability Mechanism (ESM) beyond the current 500 billion euros would be a major step and an encouraging signal.
"We expect European countries will review the combined ceiling of 500 billion euros of EFSF (European Financial Stability Fund) and ESM in a very positive manner," the official told Reuters.
European leaders agreed in Brussels earlier this month to accelerate the launch of the ESM by a year to mid-2012 with an effective lending capacity of 500 billion euros ($650 billion), but questions have arisen about the size and timing of contributions.
(Reporting by Tetsushi Kajimoto and Tomasz Janowski)
